This proposal explores the hematopoietic potential of mouse embryonic stem (ES) cells, with the ultimate goal of discovering principles that govern the differentiation of ES cells into hematopoietic stem cells (HSCs) that can be used to model transplantation in murine systems. To date, there has been no definitive demonstration that a pluripotent stem cell capable of engrafting irradiated adults arises in vitro during ES cell differentiation into embryoid bodies (EBs). Following differentiation of ES cells genetically modified to express BCR/ABL, HoxB4, or STAT5, we have succeeded in demonstrating hematopoietic engraftment of irradiated adult mice with a common lymphoid-myeloid progenitor from EBs. We are thus well positioned to investigate the nature of the common lymphoid-myeloid progenitor in EBs, and the mechanisms governing the potential for such cells to engraft in embryonic and adult hematopoietic microenvironments. We have proposed methods for isolating enriched populations of EB-derived progenitors using selectable markers driven off of hematopoietic specific promoters, and will endeavor to more carefully define the surface antigen phenotype and in vivo properties of this cell. We will determine whether the native cells have a distinct developmental potential (i.e., capacity for engraftment of fetal or newborn sites but not adult). We will test the hypotheses that engraftment is facilitated by homing, enhanced cell survival, or cell proliferation, and probe the molecular basis for these observations. Our results will enable methods for enhanced hematopoietic development from ES cells and reconstitution of the adult hematopoietic system as a model for hematopoietic research and cellular therapies. Future efforts will explore the similarities and differences in the hematopoietic potential of murine and human ES cells, making use of repopulation studies of human cells in NOD/Scid mice.